Alterra Q1 profits up 34% as Markel deal closes
Markel Corporation has announced it has completed its acquisition of Bermuda-based Alterra Capital Holdings Limited.
The merger’s closing follows the receipt of all the necessary regulatory approvals. Markel chairman and CEO Alan Kirshner said the acquisition of Alterra will help Markel expand its product offerings and geographic reach.
"As we have said from the outset, we believe the combination of Alterra with Markel will create a strong company in global specialty insurance and investments, with a demonstrated track record of underwriting discipline in niche market segments and proven asset management strengths that should benefit all our stakeholders,” Mr Kirshner said.
The completed acquisition creates a very large specialty insurance, reinsurance and investment management group with a combined shareholder equity of around $6 billion and $23 billion in combined assets. Markel gains two new businesses from Alterra Bermuda — its large-account commercial insurance portfolio, which will now be called Markel Global Insurance and its large reinsurance business, which will be called Markel Global Reinsurance.
"For our broker and client partners this should be a seamless transition,” Mr Kirshner said. “The people you dealt with yesterday are the people you will deal with today. We look forward to giving our customers the same service to which they've become accustomed — 'scale enhanced, business as usual',” he added.
Alterra’s Q1 results were no doubt good news for Markel as the deal officially closed. Alterra’s pre-tax profits rose more than a third year-on-year to $100 million in the first quarter.
The company’s combined ratio improved by 5.2 percentage points from Q1 of 2012 to 87.4 percent in the first three months of 2013.
Gross written premiums in the period fell 1.7 percent to $650 million, driven by a reduction in Alterra’s US re/insurance book. However, net premiums written rose 5.2 percent from the first quarter of 2012 to $460 million.
For its part, Markel reported a combined ratio of 91 percent for the first quarter of 2013, compared to 100 percent for the first quarter of 2012.
The company’s total operating revenues grew 12 percent to $820 million in Q1 2013 from $733 million in 2012.
Gross written premiums for the first quarter 2013 were $743 million, an increase of 15 percent, compared to Q1 2012.
Alterra Capital Holdings Ltd. has now delisted from the Bermuda Stock Exchange following the completion of the merger with Markel.